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Stocks Mixed as Fed Tapering Looms

Written by: Andrea Tse07/10/13 - 4:27 PM EDT

Tickers in this article:
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NEW YORK ( TheStreet) -- Major U.S. stock markets closed mixed on Wednesday after minutes from the Federal Reserve's June meeting indicated that several policymakers were cozying to the plan of reducing the central bank's asset purchase program.

The minutes said that the committee once again discussed strategies for the gradual normalization of its monetary policy stance and the size and composition of the Fed's balance sheet, with about half advocating an end to purchases in late 2013, which supports the view that tapering could begin this year. However, while most participants said these discussions were a good idea for longer-term planning, "some felt that the discussion was premature" as they needed even more reinforcing evidence that the labor market was truly back on its feet.

"It's not a done deal and there is still July/August labor market data," said Tanweer Akram, senior economist at ING Investment Management. "Provided those are decent numbers around 175,000 to 200,000 added payrolls and unemployment rate gradually continues to decline a bit, I think that those would be sufficient to begin gradual tapering of the program."

Family Dollar Stores was the biggest gaining stock in the S&P, popping more than 7% to $68.50 after the retailer booked fiscal third-quarter earnings of $1.05 a share, beating expectations by two cents. The company also hiked its full-year outlook but cautioned that some customers are facing "financial headwinds."

Dollar General was the second largest gainer, up 5.8% to $54.78 after the company posted quarterly earnings that beat estimates by two cents at $1.05 a share amid improved profits margins, stronger management of inventories and a rise in same-store sales by 2.9%.

Nabors Industries was worst percentage decliner on the S&P 500 after the land drilling contractor reported a preliminary miss for the second quarter and said it was cautious on forward guidance for pressure pumping. Shares of the company lost 6.3% to $14.99.

Xbox maker Microsoft rose 1% to $34.70 after the South China Morning Post reported that China may soon end a 13-year ban on the sale of gaming consoles in the country with the support of Premier Li Keqiang, who is eager to see a wider usage of the Chinese currency and open the Chinese economy to the world.

Apple dipped 0.38% to $420.73 after the tech giant was found guilty by a federal judge of colluding with five large U.S. publishers to raise e-book prices as it set foot in the market in 2010. "Apple played a central role in facilitating and executing that conspiracy," U.S. District Judge Denise Cote said in a 160-page ruling.